The hard facts about the future

Friday

Jan 25, 2013 at 12:00 PMJan 25, 2013 at 1:01 PM

Robert J. Samuelson - Economic Commentary

There was a make-believe quality to President Obama's second inaugural address, as if all that's required to solve serious problems are the intelligence to produce proper policies and the political grit to get them approved. Perish the thought that there are deep conflicts among the things that Americans want, or the possibility that some problems lack easy, obvious and inexpensive remedies. This isn't the vision Obama was peddling.

Take two examples: paying for the retirement of the baby boom, mainly through Social Security, Medicare and Medicaid; and responding to climate change.

On the baby boom, Obama said: "We reject the belief that America must choose between caring for the generation that built this country and investing in the generation that will build its future."

On climate change: "We will respond to the threat of climate change, knowing that the failure to do so would betray our children and future generations."

Against this rousing rhetoric stand daunting realities.

Of course, there are conflicts between the young and old. In 2000, there were 45 million Social Security recipients; by 2025, the Social Security Administration projects the number at 79 million. Already, paying for retirees is the largest source of federal spending. In 2012, Social Security ($762 billion) exceeded defense ($651 billion) by 17 percent; Medicare and Medicaid together ($720 billion) also topped defense. (Two-thirds of Medicaid goes to the elderly and disabled.)

Excluding these programs from even modest budget cuts -- as Obama seems inclined to do -- imposes huge costs on the young. Their taxes will rise, big deficits will persist or spending cuts will be concentrated on other programs more important to the working population (for starters, grants to state and local governments). There's no honest way around these conflicts, but Obama pretended they don't exist.

On climate change, the difficulty is greater. Environmentalists argue that emissions from fossil fuels (coal, oil, natural gas) need to be cut 50 percent to 80 percent by mid-century to avoid a ruinous warming. The problem is that there's simply no plausible way to get from here to there without, in effect, shutting down the world economy.

Consider a recent study by the International Energy Agency in Paris. Under current policies, it forecasts that world energy demand will rise 47 percent between 2010 and 2035 and the increase in emissions of carbon dioxide -- the largest greenhouse gas -- will be almost the same. Even when the forecast assumes greater energy efficiencies and a larger shift to wind, solar and other non-fossil fuel sources, energy demand grows 35 percent by 2035 and CO2 emissions 23 percent.

Virtually all the increases occur in China, India and other developing countries. By 2035, estimates the IEA, the number of passenger vehicles in the world will double to 1.7 billion. Electricity demand will surge, as industry expands, more people move into the middle class and many now without electricity (1.3 billion) receive it. American CO2 emissions are projected to stay roughly level by 2035, but even if they fell sharply, the declines wouldn't offset increases elsewhere in the world.

The politics of climate change are excruciatingly difficult. Do we make heroic efforts (involving more regulations, subsidies or energy taxes) to curb emissions when any U.S. decreases would have only a tiny global effect? Barring major technological breakthroughs, influencing climate change seems difficult, if not impossible. There aren't yet sufficient practical alternatives to a heavy reliance on fossil fuels.

Why are Americans so disillusioned with politics? One reason is that our leaders -- and this applies to both parties -- often create narratives that seem uplifting and convincing only because they are completely detached from underlying realities. These fantasies transcend routine rhetorical flourishes and self-serving exaggerations and simplifications. But sooner or later, the realities assert themselves. People grasp that they've been misled. They feel betrayed; there's a backlash.

The job of the president is not merely to inspire. It is first and foremost to inform -- to help people see the world as it is, not as they wish it to be -- and then to craft policies based on that understanding. Barack Obama is so confident of his rhetorical powers that he violates such self-restraint. In his speech, he casually mentioned "hard choices" but didn't say what they are; he offhandedly acknowledged that combatting climate change will be "long" but didn't say why. His make-believe assumptions sound good but will have a short shelf life.

Robert Samuelson is a columnist for the Washington Post Writers Group. His weekly column and blog appear online at telegram.com.